Hejazi v Naude

[2021] QCATA 15

QUEENSLAND CIVIL AND
ADMINISTRATIVE TRIBUNAL

CITATION:

Hejazi v Naude & Anor [2021] QCATA 15

PARTIES:

DANIEL HEJAZI

(appellant)

v

JOSHUA SHAUN NAUDE

ROSALINE NAUDE

(respondents)

APPLICATION NO/S:

APL067-20

ORIGINATING APPLICATION NO/S:

MCDO 256/19 (Beenleigh)

MATTER TYPE:

Appeals

DELIVERED ON:

28 January 2021

HEARING DATE:

On the papers

HEARD AT:

Brisbane

DECISION OF:

Member Gordon

ORDERS:

Leave to appeal is refused.  This means that the appeal fails.

CATCHWORDS:

APPEAL AND NEW TRIAL – PROCEDURE – QUEENSLAND – WHEN NO APPEAL LIES – leave to appeal – where appellant sought leave to appeal against an Adjudicator’s decision in a minor civil dispute – where the Adjudicator found that a used car supplied by the appellant was unfit for the purpose – whether any reasonably arguable grounds of appeal

Australian Consumer Law, s 54, s 55

APPEARANCES & REPRESENTATION:

Appellant:

Self-represented

Respondent:

Self-represented

This matter was heard and determined on the papers pursuant to s 32 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld)

REASONS FOR DECISION

1. In March 2019 Joshua Shaun Naude and his mother Rosaline Naude purchased a car from Daniel Hejazi, a motor dealer.  The car was an Audi A4 1.8T, first registered from new in 2011 and with 95,791 kilometres on the odometer at the time of purchase.  They paid $10,500 for the car.  Soon after the purchase, they had trouble with it and over the next seven months spent nearly $10,000 in repairs.  They applied to the tribunal for recovery of this sum from Mr Hejazi.

2. At the hearing, the Adjudicator found that the Australian Consumer Law guarantees which applied to the supply of the car had not been complied with, and that the condition of the car was not as described by Mr Hejazi at the time of the purchase. The Adjudicator ordered him to pay to the purchasers a total of $8,572.36. Mr Hejazi now appeals against this decision.

3. The Appeal Tribunal has obtained a transcript of the hearing.  The Adjudicator heard from both sides and looked at the documentation.  The Adjudicator gave careful and detailed reasons for the decision.

4. In his grounds for appeal Mr Hejazi contends that there were a number of errors in the Adjudicator’s decision.  These conveniently reduce to these grounds:

   (a)The Adjudicator should not have relied on the evidence from Automotive Developments Australia (AmD) which was given in a written report backed by oral evidence at the hearing.

   (b)The following findings were contrary to the evidence: that he had sold the car with oil leaks, worn bushes and worn brake pads, and that the engine of the car had been replaced illegally at some time prior to purchase.

   (c)The Adjudicator was wrong to find that the car was not fit for the purpose, and failed to consider that the cause of the car overheating was lack of appropriate maintenance or errors made when the turbo charger unit was replaced.

   (d)The Adjudicator failed to regard the purchasers’ failure to return the car to Mr Hejazi for repairs as a failure of the duty to mitigate loss.

5. In addition to his submissions in the appeal, Mr Hejazi has submitted further evidence and some documents to the Appeal Tribunal which were not before the Adjudicator at the hearing.  It appears that Mr Hejazi is asking the Appeal Tribunal to consider ‘fresh evidence’.  The difficulty with this is that directions were given by the Appeal Tribunal on 19 March 2020 providing that if a party to the appeal wished to rely on any documents which were not before the tribunal below, then a formal application should be made including submissions explaining why the fresh evidence was not available to the tribunal below, why it is important and why it should be accepted.  No such application was made.  Because of this I am unable to accept the documents as fresh evidence.

6. There is no appeal against these findings of the Adjudicator:

   (a)Mr Hejazi advertised the car as being in ‘as new condition’.[1]

   (b)At the time of purchase, Mr Hejazi told the purchasers that the car did not use oil and was in good condition.[2]

   (c)At the time of purchase, Mr Hejazi told Mrs Naude that he had owned the vehicle for two years, but in truth he had never owned it personally and had bought it at a dealer’s auction.[3]

   [1]Transcript 1-45 line 25 and 37.

   [2]Transcript 1-45 line 14 and 38.

   [3]Transcript 1-45 line 17.

Consideration of the grounds of appeal

1. An appeal can be prosecuted on the basis that the decision maker took into account evidence that should not have been accepted.  In ground of appeal (a) Mr Hejazi says that the AmD report was not signed, did not show the ability of its author to assess the car, and did not give the odometer reading.[4]

   [4]Grounds for appeal point 4.

2. The maker of the report, Mr Scott Everett, gave evidence at the hearing over the telephone and confirmed that he had written the report.  Because of this the Adjudicator was not in error by accepting the report in evidence without it being signed.

3. In the report, Mr Everett described what he found on testing and stripping the engine, and gave an opinion about matters relevant to the claim.  The report itself described his expertise and ability to give this evidence, and he confirmed this orally.[5]  There is no doubt that the Adjudicator was right to decide that Mr Everett was sufficiently qualified and experienced to give this evidence.

   [5]Transcript 1-33 line 11.

4. It is true that the report would have been more helpful if it had contained an odometer reading but this does not mean that the Adjudicator should have rejected the report.

5. For the above reasons, ground of appeal (a) is bound to fail.

6. In ground of appeal (b) Mr Hejazi challenges findings of fact said to have been made by the Adjudicator.  An appellant who challenges findings of fact is normally limited to contending that the Adjudicator’s findings of fact were not open to be made on the properly admissible evidence at the hearing.  If Mr Hejazi can show this, then such findings could be overturned on appeal because the Adjudicator would have been in error.  But the Appeal Tribunal is unable to reconsider the evidence before the Adjudicator and reach a different view from that reached by the Adjudicator in the absence of such an error.

7. It is suggested that the Adjudicator found that the car had been sold with oil leaks, worn bushes and worn brake pads.  The worn bushes are a reference to the front suspension bushes.  However, this is not exactly what the Adjudicator found.  It is correct that the Adjudicator found that at the time of purchase the car emitted exhaust fumes,[6] that there was an oil leak and it was using considerable amounts of oil which progressively worsened,[7] and that the defects found by Mr Everett and described in the AmD report (which included the worn front suspension bushes) were probably substantially in existence.[8]

   [6]Transcript 1-45 line 46.

   [7]Transcript 1-46 line 6, 1-47 line 40, 1-49 line 12, 1-51 line 1.

   [8]Transcript 1-50 line 46.

8. Mr Hejazi’s main point about these defects at the hearing was that if they had existed at the time of sale, they would have been picked up in the safety inspection.[9]  Also he says that he was aware of the oil leak when he first took possession of the car because it was in the auctioneer’s report, but that this was repaired prior to the sale.  

   [9]A case repeated in the grounds for appeal points 1 and 5.

9. It is clear from the reasons however, that the Adjudicator was not satisfied that the result of the safety inspection demonstrated that the defects did not exist, and that the oil leak had been fixed. 

10. The evidence from the purchasers was that the car was emitting exhaust fumes and using an excessive amount of oil from the day of purchase, much more than would be expected in such cars, and this is supported by the repair invoices.  It was clearly open to the Adjudicator to find that there was still a problem with an oil leak and/or excessive oil consumption at the time of purchase.

11. As for the suspension bushes, the Adjudicator noted that some 10,000 kilometres after the sale, the front suspension bushes were inspected by AmD and found to be ‘completely worn out and split through’, incapable of supporting the suspension mechanism and rendering the car unroadworthy.  They also indicated far more use than the mileage shown on the odometer at the time of sale.[10]  Clearly it was open to the Adjudicator to find that this fault was substantially in existence at the time of the purchase.

    [10]Transcript 1-48 line 25.

12. As for the brake pads, the Adjudicator noted that they had to be replaced in the service of 27 April 2019.[11]  The Adjudicator did not find that this contributed to the car being unfit at the time of the purchase.[12] 

    [11]Transcript 1-45 line 47.

    [12]This was not one of the defects found by Mr Everett because his inspection was much later.

13. The Adjudicator’s finding that the engine had been replaced at some point prior to the purchase and that the new engine number had not been notified to the Queensland Government was in response to Mr Everett’s evidence about this and his photographs.  These showed that the original engine number had been ground away and written over.  In this appeal, Mr Hejazi says that on his enquiry of previous owners this did not happen, the work on the engine number looks recent, and such a discrepancy would have been spotted in the safety inspection.[13]  Hence he says that the Appeal Tribunal should find that it did not happen.  The evidence before the Adjudicator however, clearly showed that the engine had been replaced and this is not a finding which can be reversed on appeal.

    [13]Grounds for appeal point 11.

14. It follows that on the evidence presented it would have been difficult for the Adjudicator to have reached a different conclusion on the facts challenged in this ground of appeal.  The ground is bound to fail.

15. As for ground (c), the Adjudicator applied the Australian Consumer Law.[14]  It is correct that the Adjudicator found that the car was not fit for its intended purpose.[15] This would be a contravention of section 55 of that law. But the Adjudicator’s findings went further than this. The Adjudicator found that the car suffered from fundamental and major defects and that it was inevitable that it would fail within a relatively short time.[16]  The Adjudicator found that the car was probably substantially defective at the time of the purchase in respect of those matters identified by Mr Everett of AmD except that the excessive use of oil became progressively worse over time.[17]

    [14]This is in schedule 2 to the Competition and Consumer Act 2010 (Cth) applied in Queensland by the Fair Trading Act 1989 (Qld).

    [15]Transcript 1-49 line 28.

    [16]Transcript 1-49 line 16.

    [17]Transcript 1-51 line 1.

16. There were also Mr Hejazi’s representations about the car.  It is not in dispute that in the advertisement for the sale of the car, Mr Hejazi said it was in ‘as new condition’.  The Adjudicator found that this description was incorrect.[18]  Further, on the Adjudicator’s findings, Mr Hejazi’s statements at the time of the purchase that the car did not use oil and was in ‘good condition’ were also incorrect.

    [18]Transcript 1-49 line 14.

17. Such descriptions, even if not being themselves contractual terms, are to be taken into account when deciding whether the car as supplied was of acceptable quality.[19] The guarantee that goods supplied to a consumer in trade or commerce are of acceptable quality is in section 54 of the Australian Consumer Law.

    [19]Section 54(3)(d) of the Australian Consumer Law.

18. It is relevant that to satisfy the guarantee of acceptable quality, a car must be fit for all the purposes for which goods of that kind are commonly supplied, it must be acceptable in appearance and finish, free from defects, safe and durable, as a reasonable consumer full acquainted with the state and condition of the goods (including any hidden defects of the goods) would regard as acceptable, having regard to certain matters.  The matters are the nature of the goods, the price of the goods (if relevant), any statements made about the goods on packaging or labels or representations made by the supplier or manufacturer and any other relevant circumstances.[20]

    [20]Section 54(2) and (3).

19. The upshot of these provisions is that a consumer is entitled to have a car supplied which will remain useable and roadworthy for a reasonable length of time and use.  That time and use will depend on the price, age and the apparent and represented condition of the car.  The correct test is not therefore, as Mr Hejazi appears to contend in his submissions in this ground of appeal and in the hearing, whether the car was ‘driveable’ or roadworthy at the time of purchase.  It must remain roadworthy for a reasonable length of time and use after purchase.

20. There was an abundance of evidence before the Adjudicator to support the decision that the Australian Consumer Law guarantees were not complied with.  The Adjudicator referred to this evidence in the reasons.  There were smoke emissions from the exhaust when the car was collected after the purchase.[21]  From that time the engine was using much more oil than would be usual even for an engine of this type.[22]  This became progressively worse over time,[23] so that the car was not useable.[24]  At the end of May 2019 the purchasers took the car to an Audi dealer to try to identify the cause of the problem and they recommended further tests.  In June 2019 the car was serviced by another repairer who reported that the black smoke from the exhaust emission was not acceptable and that the turbo charger unit may be the cause.  In mid August 2019 the turbo charger unit was replaced but this did not solve the problem.[25]  At the end of October 2019 the car was inspected by AmD who confirmed that the consumption of oil was excessive at half a litre per 50 kilometres, there was heavy black smoke from the exhaust and a misfire from the engine.  On inspection it was found that cylinders 1 and 4 had zero compression and there was evidence of overheating.  They stripped the engine and found that the amount of wear indicated that it had been used for many more kilometres than recorded in the odometer.  The engine number had been removed and an engine code engraved into the engine block, so this was not the original engine for the vehicle.  The front suspension bushes were completely worn out and split through and could not control the car’s suspension and were not roadworthy.  Again the opinion was expressed that this wear indicated that the car had had far more use than showing on the odometer.

    [21]Transcript 1-45 line 45.

    [22]The Adjudicator accepted that it is normal for engines of this type to use oil – transcript 1-50 line 36.

    [23]Transcript 1-51 line 1.

    [24]Transcript 1-46 line 5.

    [25]Transcript 1-46 lines 19 to 31.

21. The Adjudicator found that the fact that the engine was a replacement explained the problems experienced by the purchasers, including the excessive oil consumption and the eventual failure of the engine altogether.[26]  AmD had to rebuild the engine at substantial cost.

    [26]In particular, transcript 1-49 line 11.

22. In this appeal Mr Hejazi suggests that the Adjudicator should have found that the progressive problems with the car from purchase were as a result of ‘lack of appropriate maintenance’.  In his submissions in support of the appeal he explains that this includes ‘ignorance of warning lights’.[27]  This was not a point made in the hearing, so it is difficult to criticise the Adjudicator for not making this finding.  In the hearing Mr Hejazi offered the Adjudicator a number of theories to explain the deterioration of the engine.  The Adjudicator asked the purchasers to comment on each theory, but they denied them all.  The theories were: misuse by being driven round a race track,[28] or otherwise not driven normally,[29] high mileage since purchase (possibly 50,000 kilometres),[30] or that the purchasers had themselves changed the engine after purchase.[31]  Had Mr Hejazi mentioned the theory that the purchasers had driven the car with warning lights on, then this too would have been put to the purchasers to comment upon at the hearing.  To raise this on appeal for the first time is far too late.

    [27]Submissions in support of the appeal received 20 April 2020, point 3.

    [28]Transcript 1-22 line 31.

    [29]Transcript 1-27 line 46 to 1-28 line 17.

    [30]Transcript 1-43 line 15.  Mr Naude told the Adjudicator that by the time of the hearing in January 2020 the odometer read 105,000 - that is 9,300 kilometres higher than when purchased nine months previously.

    [31]Transcript 1-43 line 5.

23. After the Adjudicator had made the decision and given oral reasons, Mr Hejazi raised the possibility that the car had been revved too high – ‘up to the red line, obviously’.  But this was a new point after the decision had been made, so the Adjudicator rightly refused to consider it.[32]

    [32]Transcript 1-53 line 1.

24. As for the turbo charger, at the hearing Mr Hejazi submitted that it was possible it had not been replaced properly and that this had been the cause of the problems with the car.[33]  But the difficulty was that there was no evidence of this at all.  So it is not surprising that the Adjudicator did not find that the replacement turbo charger unit was to blame.  In fact, when assessing damages the Adjudicator disallowed the cost of replacing the unit because it had not been responsible for the excessive oil consumption.[34]

    [33]Transcript 1-25 line 15.

    [34]Transcript 1-46 line 30.

25. By reason of the above, ground of appeal (c) has no chance of succeeding.

26. As for ground of appeal (d), the Adjudicator found that the reason why the purchasers did not take the car back to Mr Hejazi for repair was that they did not trust him, and preferred to have it repaired by AmD.[35] The Adjudicator pointed out that there was a disagreement about the repair which was required. AmD were saying that a complete engine rebuild kit had to be purchased because of the inability to secure individual parts, some being unavailable. So effectively a complete engine rebuild was required. But Mr Hejazi was saying that this was not necessary. The Adjudicator found however, that AmD were correct,[36] and seemingly it was on that basis that the Adjudicator decided the purchasers acted reasonably by having the repairs done by AmD rather than by Mr Hejazi. In the circumstances the Adjudicator ’s decision about this must stand.

    [35]Transcript 1-49 line 37.

    [36]Transcript 1-49 line 46.

Conclusion in the appeal

1. Leave is required to bring an appeal of this type.  Leave must be refused because there is no arguable case on appeal.  This means that the appeal fails.